Handbook and other statements made about the availability of FMLA leave may be binding

In a decision issued by the United States Court of Appeals for the Sixth Circuit (the “Court”) on January 26, 2015, an employee who, but for statements made by his employer, would not have been eligible for leave under the FMLA was nevertheless found to be entitled to it. The Court’s opinion in Tilley v. Kalamazoo County Road Commission, et al. should serve as a warning to all employers that statements made to employees about their FMLA eligibility may be binding, even if the employees do not meet the eligibility criteria required by the statute.

The FMLA provides that an employee is eligible for job-protected leave if he meets three criteria: (1) he has been employed by a covered employer for at least 12 months; (2) he has worked at least 1,250 hours in the prior 12-month period; and (3) he works at a location that employs at least 50 employees within a 75-mile radius.

Terry Tilley met the first two criteria, but, because he had fewer than 50 colleagues within a 75-mile radius of his work location, he did not meet the third and should have been ineligible for FMLA leave. However, when he needed time off for a suspected heart attack, his employer, the Kalamazoo County Road Commission (the “Commission”), sent him FMLA paperwork with a cover letter that informed him that he was “eligible for FMLA leave,” provided him with a “Notice of Eligibility and Rights & Responsibilities” form on which the “eligible for FMLA leave” box was checked, and instructed him to have his physician complete a medical certification form to support his request for FMLA leave. In addition, the Commission’s personnel manual stated that employees who “accumulated 1,250 work hours in the previous 12 months” were eligible for FMLA leave. The policy was completely silent about the 50 employee/75-mile radius eligibility requirement.

Tilley’s employment was terminated because he failed to complete specific job assignments on time pursuant to a final written warning he had been given. He maintained that the reason he was unable to complete them by the deadline was because of time he needed off work, which he understood would be protected FMLA leave based on the language of the personnel manual and the letter he was sent by the Commission. Tilley filed suit, claiming, in part, that the Commission interfered with his right to FMLA leave and retaliated against him for his use of FMLA leave.

The Commission defended Tilley’s claims by arguing that, because Tilley did not work at a location that employed at least 50 employees in a 75-mile radius, Tilley was ineligible for FMLA leave, thereby making his FMLA interference and retaliation claims meritless. The lower court agreed with the Commission, granted the Commission’s motion for summary judgment, and dismissed Tilley’s FMLA claims.

On appeal, the Sixth Circuit took a different view, finding that the Commission was equitably estopped from raising non-eligibility as a defense. To prevail on a theory of equitable estoppel, Tilley needed to prove only: (1) a definite misrepresentation as to a material fact; (2) a reasonable reliance on the misrepresentation; and (3) a resulting detriment to the party reasonably relying on the misrepresentation. The Court found that the personnel manual language alone was a definite misrepresentation of a material fact, his eligibility to apply for FMLA benefits. It also found that a self-serving sworn affidavit, in which Tilley asserted that he would have delayed seeking treatment for his suspected heart attack if he had understood that, contrary to the language of the personnel manual, he was not eligible for job-protected FMLA leave, was sufficient evidence that he reasonably relied on the misrepresentation. The Court acknowledged that “there are obvious reasons to doubt the veracity of Tilley’s assertion,” but held that “the ultimate question of Tilley’s credibility is for the jury.” Because Tilley’s employment was terminated, the Court had no trouble finding that he suffered a detriment as a result of his reliance on the policy. Despite not being eligible for FMLA leave, the Court remanded this case back to the lower court for a trial on Tilley’s FMLA interference and retaliation claims.

Bottom line for employers

Employers should take care to make sure that their FMLA policies list all of the requirements for eligibility. The Court noted in its decision that the Commission’s FMLA policy would not have supported Tilley’s equitable estoppel claim if the Commission had merely qualified the policy’s statement concerning employee eligibility by adding reference to the requirement that the employee work at a location that had at least 50 employees within a 75-mile radius. While the Commission would still have had to deal with the later statements about eligibility made in the cover letter to the FMLA paperwork, Tilley would not have been able to argue that his failure to complete the work assignment, which was due the day of the suspected heart attack, was the result of his reliance on the language of the policy, and the Court’s decision in this case might have been much different.

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